Marc Dreier's Big Break

Louis Lanzano / AP Photo The crooked lawyer’s $700 million scam gets him only 20 years in the clink, and he has Bernie Madoff to thank for it. The Daily Beast’s Allan Dodds Frank reports.

The long shadow of Bernard Madoff’s 150-year sentence allowed crooked lawyer Marc Dreier—also one of the biggest fraudsters ever—to look forward to light at the end of the tunnel known as the federal penitentiary.

“To suggest this was close to Madoff would be to substitute ideology for analysis,” said U.S. District Judge Jed Rakoff, who gave Dreier 20 years and ordered him to forfeit nearly $384 million. “Mr. Dreier’s crimes, despicable though they may be, pale in comparison to Mr. Madoff.”

After classifying the 59-year-old Dreier as guilty of fraud of “epic proportions” and “appalling betrayal of trust,” Rakoff rejected the Justice Department's request for the cumulative maximum of 145 years, just five years short of the maximum for Madoff.

“To suggest this was close to Madoff would be to substitute ideology for analysis,” said U.S. District Judge Jed Rakoff. “Mr. Dreier’s crimes, despicable though they may be, pale in comparison to Mr. Madoff.”

“Are you serious, is the government serious about asking for 145 years in prison?” Rakoff asked Assistant U.S. Attorney Jonathan Streeter.

The prosecutor replied: “We are serious about asking for life imprisonment, “ before admitting to the judge that “anything over 30 years” would amount to life.

“I knew you were going to do that to me,” added Streeter.

Rakoff said “for the government to ask for 145 years is to demean the sentence that Judge [Denny] Chin imposed on Mr. Madoff,” adding that the 145-year request for Dreier was “beyond all reason as far as white-collar crime is concerned. It sends so much the wrong message… It says the government is not sensitive to being fact-specific.”

Taking note of “judicial activism” by the Supreme Court and Sonia Sotomayor’s confirmation hearings, Rakoff challenged the entire notion of “life imprisonment” for white-collar criminals. He raised the question of why life imprisonment, if the strongest penalty made into law by Congress is 20 years.

Rakoff added that given the multiple crimes committed by Dreier, the government could have charged him with enough counts to stack the maximum allowable penalties up to 1,000 years.

Dreier, educated at Yale College and Harvard Law School, impersonated money managers and financiers and forged dozens of documents while selling fake investments and stealing from his law firm’s clients’ escrow accounts.

In seven years, he took in more than $700 million from 30 outside institutional investors and destroyed his 250-member law firm and its clients.